The Benefits to Taxpayers from Increases in Students - RAND ...

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70 The Benefits to Taxpayers from Increases in Students’ Educational Attainment Center for Education Statistics, 2007, Table 33, p. 46). Assuming that K–12 school districts can generally accommodate some increases in enrollment without additional construction, we estimate that the cost of additional education in secondary schools will average about $7,700 per pupil ADA. If a student were to complete high school rather than dropping out, taxpayers would have to pay roughly $15,000, in 2002 dollars discounted to age 18, to pay for the additional schooling. In the 2000–2001 school year, the most recent school year for which data were available, public two-year colleges’ current expenditures averaged about $9,400 per FTE pupil (U.S. Department of Education, National Center for Education Statistics, 2007, Table 346, p. 500). Two-year colleges’ tuition and fees that year averaged about $1,800 per FTE (U.S. Department of Education, National Center for Education Statistics, 2007, Table 320, p. 467). We assume that virtually all two-year colleges’ expenditures are for educational activities and that federal, state, and local government appropriations provide the difference between two-year colleges’ average current expenses and students’ tuition and fees. Accordingly, it would cost taxpayers about $7,600 per FTE to provide additional education in a two-year college. We assume that students who are induced to obtain some college rather than terminating their education at high school graduation will generally attend lowercost institutions that are relatively close to their homes. Accordingly, we assume that increasing education from high school graduation to some college will cost taxpayers about $15,000, in 2002 dollars, to pay for the increase in education. In the 2000–2001 school year, public four-year colleges’ current expenditures averaged about $28,000 per FTE pupil (U.S. Department of Education, National Center for Education Statistics, 2007, Table 346, p. 500). Students’ tuition and fees that year averaged about $7,800 per FTE (U.S. Department of Education, National Center for Education Statistics, 2007, Table 320, p. 467). Public four-year institutions’ current revenues other than tuition and fees are equally divided between sources of revenues that contribute, at least in part, to the costs of educating students (federal, state, and local government appropriations; private gifts, grants, and contracts; and endowment income) and revenues from sources (federal, state, and local government grants; contracts; federally funded research and development centers; independent operations; and sales and services) that generally support expenditures on activities other than education. If all the funds provided by the first group of sources are used to support educational expenses, taxpayers spent about $10,100 per FTE student in public fouryear institutions for educational purposes. We assume that it would cost taxpayers about $10,000 per FTE to provide additional education in a four-year public college or university. We estimate that increasing education from some college to a college degree will cost taxpayers about $20,000 in 2002 dollars. Finally, the extreme example we consider is increasing a student’s education from high school dropout to college graduate. This would entail two more years of high school and four years of college. The costs of providing this increase would be spread
The Costs of Providing Additional Education 71 over six years. The discounted present value of the cost of this increase in education would be about $47,000 in 2002 dollars. Research has shown that the average cost of education per student falls as the number of students in a school or district rises. To the extent that educational attainment is increased by adding students to the existing educational infrastructure, the cost of education we use is an overestimate of the costs taxpayers would incur to increase education. For policy goals that would result in a large increase in enrollment, capacity may need to be expanded through new investments. In this case, the use of current average cost will certainly be more appropriate than current marginal cost. Across both cases, our practice of using average rather than marginal costs in our estimates implies that our net benefit calculations are lower bounds.
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THE ARTS CHILD POLICY CIVIL JUSTICE
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The Benefits to Taxpayers from Incr
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Preface Meeting the educational dem
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vi The Benefits to Taxpayers from I
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Figures 3.1. Present Value of Lifet
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xiv The Benefits to Taxpayers from
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xvi The Benefits to Taxpayers from
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Abbreviations ADA CPS EITC FTE GED
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Chapter Two Analytic Approach There
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Analytic Approach 15 effects of edu
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Analytic Approach 17 women employed
Page 45 and 46: Analytic Approach 19 State and Loca
Page 47 and 48: Analytic Approach 21 tion of educat
Page 49 and 50: Analytic Approach 23 The difference
Page 51 and 52: Analytic Approach 25 but a very sma
Page 53 and 54: Analytic Approach 27 1997 changes g
Page 55 and 56: Chapter Three Payments for Taxes an
Page 57 and 58: Payments for Taxes and Social Progr
Page 67 and 68: Chapter Four Spending on Social Sup
Page 69 and 70: Spending on Social Support Programs
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Page 99 and 100: Chapter Seven Educational Attainmen
Page 101 and 102: Educational Attainment and Public R
Page 113 and 114: Appendix A Data and Sources Data Th
Page 115 and 116: Data and Sources 89 Program Benefit
Page 117 and 118: Appendix B Estimating Tax Payments
Page 119 and 120: Estimating Tax Payments 93 Federal
Page 121 and 122: Appendix C Social Program Participa
Page 123 and 124: Social Program Participation and Co
Page 137 and 138: Appendix D Incarceration Cost Estim
Page 139 and 140: References Aos, Steve, Roxanne Lieb
Page 141 and 142: References 115 Krop, Richard, Steph
Page 143: References 117 U.S. Department of J
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